Are properties really selling over market value?

[Mark K]

​

I've shown you one, now it's your turn to show me one.

No you didn't. Examples are not the same as a definition. Citing a court document isn't the same as citing a definition regarding the examples in the document.

Also interesting is the part you cite where the examples are considered to be non-arms length. I've always said this but a contingent of AF members have been unable to grasp this concept for years. Some believe that non-AL has to be between related parties.​

That's not true. "arms length" means something, too. Just as one example of many, foreclosure sales never involve a previous relationship between buyer and seller, let alone one that would be of effect on the pricing.

I'm merely citing the last line in what you put up for your 'definition'. What's untrue about it?

 

[Alsie35]

Maybe not in your area, once again proving that real estate is local.

Absolutely true. What I think some have problems with is that I don't think that an entire market can be easily classified as being under "undue influence". That's a definition more suited, and designed for, individual homes, I think.

 

[George Hatch]

The appraisal asks for a market value opinion, not a sale price opinion.

MV definition lays out the terms of sale the MV opinion used for the opinion of value ( as defined )

The MV definition , as a definition references the terms of sale at which the most probable price occurs...the most probable price a property should bring (in a transaction occurring at the caveats and terms of the MV definition)

A straight up question what would the property sell for on X date is a related, but technically a different question...though the numerical $ price answer can be the same for both ! (or different )

Here we go again.

The "most probable price" is a direct reference to a "sale price" as would occur per the explicit assumption of the hypothetical sale which is included in this definition. Just because they didn't word it as a "most probable sale price" doesn't alter the fact that there's no alternative type of price you or anyone else can point to that would result as per that hypothetical sale.

 

[J Grant]

Here we go again.

The "most probable price" is a direct reference to a "sale price" as would occur per the explicit assumption of the hypothetical sale which is included in this definition. Just because they didn't word it as a "most probable sale price" doesn't alter the fact that there's no alternative type of price you or anyone else can point to that would result as per that hypothetical sale.

okay, I agree on that.

 

[George Hatch]

No you didn't. Examples are not the same as a definition. Citing a court document isn't the same as citing a definition regarding the examples in the document.



I'm merely citing the last line in what you put up for your 'definition'. What's untrue about it?

View attachment 53478

Actually, the reference was from an assessment text used by the govt, not a court document. And the quote from that text ends at its referance (Wisconsin Property Assessment Manual at 7-5 (rev. 12/11).). The commentary which followed was written by the lawyer at that website and is apparently not part of that text.

And you still don't have any reference for how market conditions can rise to the level of "prompting" a buyer to buy despite not wanting to.

 

[TerryRohrer]

Maybe not in your area, once again proving that real estate is local.

You seem to be arguing that there can be cases where a buyer does not have a choice, they have to buy. I cannot conjure up such a situation. Every time I try, I conclude that they are making a choice of their own free will. Can you help me with an example of a situation where someone makes a purchase where they don't have a choice? (an example comes to mind from this morning's news...Colonial Pipeline paid $4.4million in ransom...that situation, while still a choice, would likely be accurately characterized as a buyer acting under undue stimulus)

 

[George Hatch]

Do these buyers believe they are voluntarily acting in their own best interests or not? Are they initiating - on their own - their search for the best deal they can find among many, or not?

 

[Mark K]

And you still don't have any reference for how market conditions can rise to the level of "prompting" a buyer to buy despite not wanting to.

I never said that but if that's the way you chose to interpret it, be my guest.

 

[J Grant]

Actually, the reference was from an assessment text used by the govt, not a court document. And the quote from that text ends at its referance (Wisconsin Property Assessment Manual at 7-5 (rev. 12/11).). The commentary which followed was written by the lawyer at that website and is apparently not part of that text.

And you still don't have any reference for how market conditions can rise to the level of "prompting" a buyer to buy despite not wanting to.

I did not say Market conditions prompt a buyer to buy despite not wanting to. I used, as an example here, that a over supply market can see a seller accepting a price they might not otherwise accept, and a low inventory market can see a price making an offer they otherwise would not.

The assessment manual reference wrt to lawyer okay...but fact remains for MV appraisals, LV and DV have compulsion and not undue stimulus. the MV definition has undue stimulus but not compulsion )

 

[George Hatch]

I never said that but if that's the way you chose to interpret it, be my guest.

Say it however you want, the argument still amounts to saying the market conditions - itself literally comprised by the actions of those principals - are prompting people to enter into transactions they wouldn't otherwise choose to enter into because they object to the price. This, despite the direct evidence to the contrary where these parties actually are entering into these transactions at those prices - and doing so on the mass scale.

Baghdad Bob much?

Which on that I-object-to-the-price basis would apply to EVERY transaction where EVERY seller would prefer to receive more and EVERY buyer would prefer to pay less. In every single market and at every single stage of an RE cycle.

The single biggest factor that prevents every seller from getting the higher price and every buyer from paying the lower price are the prevailing market conditions and the availability and pricing of the buyer's alternatives. And that's the factor some of you want to arbitrarily dictate in your work as opposed to sticking to observe/report.